Posted on 13 Jan 2016
“Demand will be in a downtrend for a fairly long period of time in the future,” said Zhang Guangning, head of the China Iron and Steel Association (Cisa), according to a transcript of a Cisa meeting posted yesterday on the China Metallurgical News website. “Capacity, output and demand imbalance will be an acute problem.”
Production will also fall, said Wang Liqun, Cisa vice-chairman. Crude steel output will drop 25 million tonnes, or about 3%, to 781 million tonnes this year, according to estimates by the China Metallurgical Industry Planning and Research Institute. Shanghai Baosteel Group Corp has forecast that China’s steel production may eventually shrink 20%.
China’s mills, which produce about half of the world’s steel, are battling sinking prices as local consumption shrinks for the first time in a generation, while trade tensions are on the rise as the nation exports its surplus. Overseas sales would encounter more headwinds this year as many countries adopted restrictive measures on imports, Zhang said. China’s steel exports jumped 22% in the first 11 months of 2015 to 102 million tonnes.
